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Investment Securities
 9 Months Ended
Sep. 30, 2019
Marketable Securities [Abstract]  
Investment Securities Investment Securities
The following tables summarize FHN’s investment securities on September 30, 2019 and December 31, 2018:
 
 
September 30, 2019
(Dollars in thousands)
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. treasuries
 
$
100

 
$
—

 
$
—

 
$
100

Government agency issued mortgage-backed securities (“MBS”)
 
2,249,973

 
37,204

 
(2,745
)
 
2,284,432

Government agency issued collateralized mortgage obligations (“CMO”)
 
1,775,941

 
13,978

 
(5,699
)
 
1,784,220

Other U.S. government agencies
 
237,414

 
3,919

 
—

 
241,333

Corporates and other debt
 
40,105

 
425

 
(90
)
 
40,440

States and municipalities
 
46,658

 
3,435

 
(22
)
 
50,071

 
 
$
4,350,191

 
$
58,961

 
$
(8,556
)
 
4,400,596

AFS debt securities recorded at fair value through earnings:

 
 
 
 
 
 
 
 
SBA-interest only strips (a)
 
 
 
 
 
 
 
15,249

Total securities available-for-sale (b)
 
 
 
 
 
 
 
$
4,415,845

Securities held-to-maturity:
 
 
 
 
 
 
 
 
Corporates and other debt
 
$
10,000

 
$
—

 
$
(13
)
 
$
9,987

Total securities held-to-maturity
 
$
10,000

 
$
—

 
$
(13
)
 
$
9,987

 
(a)
SBA-interest only strips are recorded at elected fair value. See Note 17 - Fair Value for additional information.
(b)
Includes $3.7 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.
 
 
December 31, 2018
(Dollars in thousands)
 
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair
Value
Securities available-for-sale:
 
 
 
 
 
 
 
 
U.S. treasuries
 
$
100

 
$
—

 
$
(2
)
 
$
98

Government agency issued MBS
 
2,473,687

 
4,819

 
(58,400
)
 
2,420,106

Government agency issued CMO
 
2,006,488

 
888

 
(48,681
)
 
1,958,695

Other U.S. government agencies
 
149,050

 
809

 
(73
)
 
149,786

Corporates and other debt
 
55,383

 
388

 
(461
)
 
55,310

State and municipalities
 
32,473

 
314

 
(214
)
 
32,573

 
 
$
4,717,181

 
$
7,218

 
$
(107,831
)
 
4,616,568

AFS securities recorded at fair value through earnings:
 
 
 
 
 
 
 
 
SBA-interest only strips (a)
 
 
 
 
 
 
 
9,902

Total securities available-for-sale (b)
 
 
 
 
 
 
 
$
4,626,470

Securities held-to-maturity:
 
 
 
 
 
 
 
 
Corporates and other debt
 
$
10,000

 
$
—

 
$
(157
)
 
$
9,843

Total securities held-to-maturity
 
$
10,000

 
$
—

 
$
(157
)
 
$
9,843

 
(a)
SBA-interest only strips are recorded at elected fair value. See Note 17 - Fair Value of Assets and Liabilities for additional information.
(b)
Includes $3.8 billion of securities pledged to secure public deposits, securities sold under agreements to repurchase, and for other purposes.


The amortized cost and fair value by contractual maturity for the available-for-sale and held-to-maturity debt securities portfolios on September 30, 2019 are provided below:
 
 
 
Held-to-Maturity
 
Available-for-Sale
(Dollars in thousands)
 
Amortized
Cost
 
Fair
Value
 
Amortized
Cost
 
Fair
Value
Within 1 year
 
$
—

 
$
—

 
$
20,161

 
$
20,289

After 1 year; within 5 years
 
—

 
—

 
223,908

 
228,037

After 5 years; within 10 years
 
10,000

 
9,987

 
755

 
2,444

After 10 years
 
—

 
—

 
79,453

 
96,423

Subtotal
 
10,000

 
9,987

 
324,277

 
347,193

Government agency issued MBS and CMO (a)
 
—

 
—

 
4,025,914

 
4,068,652

Total
 
$
10,000

 
$
9,987

 
$
4,350,191

 
$
4,415,845

 
(a)
Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
The table below provides information on gross gains and gross losses from debt investment securities for the three and nine months ended September 30, 2019 and 2018.
 
 
Three Months Ended
September 30
Nine Months Ended
September 30
(Dollars in thousands)
2019
 
2018
 
2019
 
2018
Gross gains on sales of securities
$
—

 
$
—

 
$
—

 
$
52

Gross (losses) on sales of securities
—

 
—

 
(267
)
 
—

Net gain/(loss) on sales of securities (a)
$
—

 
$
—

 
$
(267
)
 
$
52

 
(a)
Cash proceeds for the three months ended September 30, 2019 were not material. Cash proceeds for the nine months ended September 30, 2019 were $182.8 million. Cash proceeds for the three and nine months ended September 30, 2018 were not material.

The following tables provide information on investments within the available-for-sale portfolio that had unrealized losses as of September 30, 2019 and December 31, 2018:

 
 
As of September 30, 2019
 
 
Less than 12 months
 
12 months or longer
 
Total
(Dollars in thousands)
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
U.S. treasuries
 
$
—

 
$
—

 
$
100

 
$
—

 
$
100

 
$
—

Government agency issued MBS
 
78,633

 
(222
)
 
219,235

 
(2,523
)
 
297,868

 
(2,745
)
Government agency issued CMO
 
234,437

 
(681
)
 
397,826

 
(5,018
)
 
632,263

 
(5,699
)
Corporates and other debt
 
—

 
—

 
25,160

 
(90
)
 
25,160

 
(90
)
States and municipalities
 
1,468

 
(22
)
 
—

 
—

 
1,468

 
(22
)
Total temporarily impaired securities
 
$
314,538

 
$
(925
)
 
$
642,321

 
$
(7,631
)
 
$
956,859

 
$
(8,556
)
 
 
 
As of December 31, 2018
 
 
Less than 12 months
 
12 months or longer
 
Total
(Dollars in thousands)
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
 
Fair
Value
 
Unrealized
Losses
U.S. treasuries
 
$
—

 
$
—

 
$
98

 
$
(2
)
 
$
98

 
$
(2
)
Government agency issued MBS
 
597,008

 
(12,335
)
 
1,537,106

 
(46,065
)
 
2,134,114

 
(58,400
)
Government agency issued CMO
 
290,863

 
(2,860
)
 
1,560,420

 
(45,821
)
 
1,851,283

 
(48,681
)
Other U.S. government agencies
 
29,776

 
(73
)
 
—

 
—

 
29,776

 
(73
)
Corporates and other debt
 
25,114

 
(344
)
 
15,008

 
(117
)
 
40,122

 
(461
)
States and municipalities
 
17,292

 
(214
)
 
—

 
—

 
17,292

 
(214
)
Total temporarily impaired securities
 
$
960,053

 
$
(15,826
)
 
$
3,112,632

 
$
(92,005
)
 
$
4,072,685

 
$
(107,831
)

FHN has reviewed debt investment securities that were in unrealized loss positions in accordance with its accounting policy for OTTI and does not consider them other-than-temporarily impaired. For debt securities with unrealized losses, FHN does not intend to sell them and it is more-likely-than-not that FHN will not be required to sell them prior to recovery. The decline in value is primarily attributable to changes in interest rates and not credit losses.
The carrying amount of equity investments without a readily determinable fair value was $25.1 million and $21.3 million at September 30, 2019 and December 31, 2018, respectively. The year-to-date 2019 and 2018 gross amounts of upward and downward valuation adjustments were not significant.
Unrealized gains of $.4 million and $1.0 million were recognized in the three months ended September 30, 2019 and 2018, respectively and $4.9 million and $2.1 million were recognized in the nine months ended September 30, 2019 and 2018, respectively, for equity investments with readily determinable fair values.